Below is a list of treatments of accounting topics. Place GAAP

on the line if the treatment is GAAP-based and place IFRS on
the line if the treatment is IFRS-based.

A. Interest and dividend income are reported in the
investing section of the cash flow statement.__________
B. Interest expense is reported in the financing section of
the cash flow statement. ___________
C. The use of LIFO is prohibited.
___________

Please Check My answers
A. GAAP
B. GAAP
C. IFRS

To confirm if your answers are correct, let's review the treatments of these accounting topics in both GAAP (Generally Accepted Accounting Principles) and IFRS (International Financial Reporting Standards):

A. Interest and dividend income are reported in the investing section of the cash flow statement.
- GAAP: Correct. Under GAAP, interest and dividend income are typically classified as operating cash flows in the cash flow statement.
- IFRS: Incorrect. Unlike GAAP, IFRS does not provide specific instructions on where to classify interest and dividend income in the cash flow statement. However, they are usually presented as operating cash flows in practice.

B. Interest expense is reported in the financing section of the cash flow statement.
- GAAP: Incorrect. In GAAP, interest expense is generally classified as an operating cash flow in the cash flow statement.
- IFRS: Incorrect. Similar to GAAP, interest expense in IFRS is typically classified as an operating cash flow.

C. The use of LIFO (Last-In, First-Out) is prohibited.
- GAAP: Correct. LIFO is an inventory costing method that is allowed under GAAP, but it is not required. Companies are free to use other costing methods, such as FIFO (First-In, First-Out) or average cost. However, LIFO is commonly used in certain industries for cost management and tax purposes.
- IFRS: Correct. Unlike GAAP, IFRS prohibits the use of LIFO as an inventory costing method. Instead, companies are required to use either FIFO or weighted average cost as the cost flow assumption for inventories.

In summary, your answers are as follows:
A. GAAP - Correct
B. GAAP - Incorrect (Interest expense is classified as an operating cash flow under GAAP)
C. IFRS - Correct